The Demise of Acute Health Care in Quincy, Massachusetts: Implications for Surviving Community Hospitals

On Friday evening December 19th at midnight, Quincy Medical Center ceased admitting patients. The last in-patient was discharged on December 23th. QMC was officially closed on December 26th, five days earlier than even the illegally announced December 31st date. Steward Health Care had already shut down QMC’s geri-psych unit several weeks before, as well as its hotly contested surgical unit. The Emergency Department however remains busy. So ended the 124-year history of this fine institution.

When Steward Health Care announced to the QMC unions on November 5th that it would close the hospital by December 31st, it committed three crimes:

1. The federal WARN Act requires a 60-day notice before any major layoff.

2. Chapter 111, Section 51G of the Massachusetts laws requires a 90-day notice before any loss of needed health services or the closing of any licensed healthcare facility, and a hearing by the Department of Public Health.

3. The covenant signed by Steward and Attorney General Martha Coakley in September 2011 has a No Close clause that requires Steward to keep QMC's needed services intact and to keep it open for ten years. If Steward can verify that it has lost money on QMC for two consecutive years, after 6 1/2 years, it may decide to close the facility after giving a 180-day notice.

To avoid being penalized for crime #1, Steward has agreed to pay current employees through January 7th. By pretending to extend the closure date to February 4th, Steward sought to avoid possible penalties for crime #2, but that covenant remains in force. Our demand was that the attorney general enforce its terms. If hospital census is dropping, it's not only because of unfair competition but also because of a failed business plan, and the conscious and systematic looting of the facility to achieve short-term cash-flow gains at the expense of the long-term viability of the hospital - at the expense of the health of the community. Steward should not be allowed to profit from its crimes. If the current covenant is voided, then no covenant entered into by any corporation has validity.

Additionally, Steward Health Care refuses to file its consolidated financial statements with the Commonwealth of Massachusetts, so regulators and the public are unable to determine where the money comes from and where it goes. Is QMC actually losing $20 million per year, as Steward claims?

Steward Health Care's CEO Ralph De La Torre had registered as a Democrat in 2007. He threw a gala fund-raiser for Barack Obama in 2010. Steward executives contributed generously to Martha Coakley's 2010 and 2014 election campaigns. The administration's healthcare czar, David Morales, an architect of the 2006 Massachusetts reform, became Steward Health Care's Executive Vice President for Policy & Strategy in 2011. The CEO of Steward's Saint Elizabeth's Medical Center, John Polanowicz, became Secretary of the Executive Office of Health & Human Services in the Deval Patrick administration in 2013, overseeing the Department of Public Health, and has been invited to return to Steward upon leaving office.

A Steward executive was so callous as to tell the assembled employees on November 6th that they were being treated so much better than the workforce at North Adams Regional Hospital, whose CEO and board only gave them three days’ notice in March before closing that hospital. To this day, neither the NARH CEO nor the Steward executives have been called to account for their criminal behavior.

At the onset of this crisis, the two unions hunkered down, tightly focusing on negotiating the softest possible landing for their members and actively discouraging any public outcry or demonstrative actions opposing the closure. Steward executives put on the table ruthless threats that Cerberus would shut down the whole system, undermining health care and employment in eleven Eastern Massachusetts communities instead of just one, if this move was blocked or their flow of profits disrupted. With state officials compromised and without mobilization by the unions, the chances of actually saving Quincy Medical Center were slim.

Mayor Tom Koch, the City Council and the city’s legislative delegation made efforts to mitigate the situation. The City Council unanimously passed a resolution to sign on to the letter from the state delegation urging the attorney general to enforce the covenant with Steward signed in September 2011. Four weeks after this crisis broke, the mayor announced that he had hired outside counsel to defend the City’s interests. Closed-door negotiations involving the mayor’s legal team, Steward Health Care and representatives of the City Council, the unions, the attorney general and the Department of Public Health resulted in a compromise.

What did we do to influence this outcome? Our backup plan of saving the emergency department if we couldn’t save the hospital became the compromise Quincy politicians settled for, not that we could possibly expect more without the mobilization of the unions. And that compromise, closing the hospital but saving a satellite emergency department under the license of Steward's Carney Hospital in Dorchester for a year, is weak on several fronts. Patients or their insurance companies now have to pay for two ambulance rides and two ED visits since they cannot be admitted here. Without backup hospital services, drugs and food are in short supply and dependent on the kindness of the folks at Carney. This arrangement is temporary until Steward opens another ED location in Quincy, so the whole original site can then be profitably flipped to a condo developer or other entrepreneur as quickly as possible.

Steward Health Care's owner is Cerberus Capital Management, one of the nation's largest private equity investment firms, headquartered in New York City. Besides Quincy, Steward/Cerberus is the major employer and controls access to care in these working-class communities: Fall River, Taunton, Stoughton, Brockton, Norwood, Dorchester, Brighton, Methuen, Haverhill and Ayer. The very real threat that Cerberus may pull the plug on Steward and create a disaster not only for Quincy but for all of Eastern Massachusetts has many paralyzed. And for-profit Steward pays taxes, giving it a political advantage among local officials of income-strapped municipalities. Steward's claim that QMC will be $20m in debt for this year alone is hard to confirm or to refute, since it refuses to file its consolidated financials. Cerberus may now find it more lucrative to engage in real estate speculation than provide health care to working-class communities.

Deregulation, privatization and magical thinking regarding markets are neoliberal dogmas absorbed by politicians at all levels in both major parties. Our Democratic legislature and Republican governor in 1991 together deregulated hospital finance. Every subsequent so-called health reform further entrenched corporate control of care and promoted competition supposedly to cut costs. But markets in health care can never be truly "free" so, instead of efficiency, competition gave us "survival of the fattest," with the richest, costliest facilities prevailing. Hence the accelerating cutbacks and closures in communities of color and other working-class areas. Waltham Hospital, Urban Medical Group, Roxbury Comprehensive Community Health Center, North Adams Regional Hospital, Lynn Union Hospital, Pathways to Wellness, Radius Specialty Hospital in Roxbury and Quincy are but a few of our losses. In May 2013, the Department of Public Health held the required hearing on Steward's decision to close the pediatric unit at Morton Hospital in Taunton. The DPH declared that service vital to the health of the community. Since it lacked any enforcement power, it could not stop Steward from going ahead with that closure, which coincidentally violated Steward's covenant with the attorney general to maintain services as a condition for converting the hospital to for-profit status.

What we’re experiencing right now is Steward Health Care’s crass and criminal behavior superimposed on a healthcare system dysfunctional in terms of guaranteeing optimal care for working-class families and communities but ideal for maximizing profits for those positioned to win. We must change this.

Healthcare facilities and services have been selectively removed from working-class communities in Massachusetts, particularly from diverse communities and communities of color. The bipartisan embrace of neoliberal ideology, which impels policymakers to deregulate, privatize and think in magical terms regarding the impact of the marketplace, underpins the gross and growing inequality that pundits now decry. In health care in Massachusetts right now, there are haves and have-nots, with a devil-take-the-hindmost attitude operating.

In 1991, the Democratic legislature and the Republican governor enacted Chapter 495, the deregulation of hospital finance. This immediately gave inordinate bargaining power to the commercial health insurance industry and led to a rash of hospital closures, mergers and acquisitions. Partners Health Care was unveiled in December 1993, and the merger of Deaconess Hospital with Beth Israel was announced a few years later. Job reengineering consultants had a field day degrading care in order to fatten the bottom line. Managed care penetration exploded, erecting additional barriers to care. For-profit hospital chains for the first time viewed Massachusetts as fertile ground.

From Greenfield to Gloucester, residents and workers are united in the colossal fight to keep their hospitals open and fully operational. Despite judgements by the Massachusetts Department of Public Health, Partners has nearly wiped out the acclaimed in-house substance abuse service at Brigham & Women's Faulkner Hospital and UMass-Memorial has drastically cut back mental health services in Fitchburg, even in the face of a glaring need to maintain and expand such services throughout the state. Roxbury Comprehensive Community Health Center ran into financial and administrative trouble and was closed in May 2013, amidst claims that Boston already has plenty of community heath centers, echoing the false assertion that Massachusetts hospitals are overbedded.

Effective measures to help stop this descent into the maelstrom, this ever downward spiral, this crisis of access, affordability, quality and equality in health care have been pulled from the ballot or languish in committee. All who strive for a just healthcare system must come together around an agenda that effects change, from empowering the DPH to enforce its judgements to creating a single-payer financing mechanism.

Quincy and South Shore residents who depend on the services of Quincy’s hospital are at the mercy of those who have the authority and power to keep a community hospital fully operational for their health and safety needs. This will be an important first step for our newly elected governor and attorney general, and the legislature. Lives are at stake!

Chronology

1890 Quincy Hospital founded by local physicians to treat granite workers.

1919 City of Quincy takes over hospital to create Quincy City Hospital.

1981 City turns over hospital management to Hospital Corporation of America/Quorum.

We call on the Massachusetts Attorney General and the incoming AG to enforce in court the commitment by Steward Health Care not to close Quincy Medical Center for 10 years (or 6 1/2 years under certain conditions).

Steward's decisions have driven patients away.

Steward must not be allowed to destroy this valuable community resource.

People will die because there is no longer a nearby hospital. Parts of Quincy, including Houghs Neck and Germantown, are over 7.5 miles from any other hospital along roads often jammed with traffic.

Quincy has many elderly and low-income residents who don't have cars or easy public transportation access to more distant hospitals.

If QMC closes, Quincy would be the largest city in New England without a hospital.

Steward claims QMC is not needed because only 20% of Emergency Room patients are admitted - but that's higher than the national average.

Steward offers an "urgent care center" - which is no more than a clinic, and is no substitute for an ER. Steward now aims to close Quincy's ER without even opening another ER as it initially promised. Yet in early December, the QMC ER was full.

Other communities in Massachusetts also need the Steward agreement enforced. If it is not, any other such hospital commitments, now or in the future, will become meaningless.

Statewide, Massachusetts needs to save its community hospitals for several reasons:

1. to preserve enough beds for our aging population and for surges in need from widespread flu, other infectious illness, and major disasters, when less-sick patients must transfer from teaching hospitals. This state already has fewer hospital beds than the US average.

2. to keep care accessible in all regions.

3. to preserve lower-cost hospitals well able to handle much standard hospital care.

4. to preserve competition among hospitals, which the state currently relies on to contain costs.

Steward's claims of money lost are unproven; this for-profit chain refuses to file legally-required financial records with the state. Action now is urgent, before Steward scares away all patients and declares Quincy Medical Center dead.

Sandy Eaton, RN, is chair of the healthcare committee of the South Shore Coalition for Human Rights.